reed magazine logosummer2006

financing Reed title

Reed aspires to be need-blind for all applicants, but simply can’t afford such generosity. At some point, something else—faculty salaries, class size, new technology, library purchases—would have to give.

Reed has money, but it isn’t flush by American higher education standards. The endowment stands at about $400 million, well below schools such as Grinnell, Williams, Swarthmore, and Amherst, each with an endowment more than double Reed’s.

To move to need-blind admission —promising to meet the full financial need of all qualified applicants—Reed would have to double the portion of its endowment devoted to financial aid, an amount that now totals approximately $100 million. And the figure would inevitably rise, says institutional research director Jon Rivenburg, as tuition increased and word spread that Reed was need-blind, attracting more needy applicants.

Reed quietly made the shift to a so-called “need-aware” admission policy four years ago. But in fact the college was never truly need-blind.

Under the old system, all students were admitted on a need-blind basis. However, the small number who required financial aid beyond the college’s ability to afford them fell under a “come anyway” policy. They would be admitted, but denied financial aid. If they came up with first-year tuition on their own, the college would grant financial aid in subsequent years. Unsurprisingly, few came.

Dean of Admission Paul Marthers recalls being flabbergasted when he was told about the previous policy during his job interview. “It was so unusual,” he says.

Steinberger calls the longstanding policy “almost cruel” because, in effect, it told students they were good enough to get in, but too poor to attend. Moreover, the practice was confusing and frequently misunderstood by parents and high school guidance counselors, who thought Reed was stingy with aid money. Diver and Marthers agreed that the policy seemed unfair and did more harm than good.

In 2003, faced with a spike in applications and a rising number of students seeking financial aid, college administrators realized they would need to change the policy or deny aid to a large number of admitted students.

Diver made the decision to go need-aware, starting with the Class of 2007. “We decided it was better to be open and admit to the fact that at some point we run out of money,” he says.

“We’d like to do the idealistic thing,” adds Marthers. “But Reed’s principles are guiding us to do this the right way, the responsible way.”

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